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CC 2015-08-25_11b Status Report_Vacation Rentals and HomestaysTO: FROM: BY: MEMORANDUM CITY COUNCIL TERESA McCLISH, COMMUNITY DEVELOPMENT DIRECTOR MATTHEW DOWNING~SOCIATE PLANNER SUBJECT: CONSIDERATION OF STATUS REPORT REGARDING DATE: DEVELOPMENT CODE AMENDMENT 14-002 REGULATING VACATION RENTALS AND HOMESTAYS AUGUST 25, 2015 RECOMMENDATION: It is recommended the City Council receive and file information on the status of Development Code Amendment 14-002, which implemented regulations for the establishment and operation of vacation rentals and homestays within the City. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: There is no impact on financial and personnel resources to receive and file the status of Development Code Amendment. BACKGROUND: On June 10, 2014, the City Council adopted Ordinance No. 663 (the "Ordinance") to identify vacation rentals and homestays as permitted uses within residential and commercial zoning districts of the City and establishing regulations and permitting requirements to establish the uses (Attachments 1 and 2). The Ordinance went into effect on July 10, 2014 As part of the approval of the Development Code Amendment, the Council requested a status report after one year. ANALYSIS OF ISSUES: At the time of Ordinance adoption, six (6) applications for vacation rentals and homestays were pending. One (1) of those applications was withdrawn following adoption of the Ordinance. Since the adoption of the Ordinance, staff has approved a total of ten (10) permits. This includes five (5) vacation rentals and five (5) homestays (Attachment 3). Staff is currently processing one (1) additional application for a vacation rental. Inquiries regarding the establishment of new rentals has subsided since the initial influx anticipated from adoption of the regulations; however, staff continues to Item 11.b. - Page 1 CITY COUNCIL CONSIDERATION OF STATUS REPORT REGARDING DEVELOPMENT CODE AMENDMENT 14-002 REGULATING VACATION RENTALS AND HOMESTAYS AUGUST 25, 2015 PAGE2 receive about two (2) inquiries per month. The inquiries are mostly from individuals in the very early stages of considering the use of their property as a vacation rental or homestay. Staff has also received inquiries from other communities in the state who are determining how to address the uses. During the Council's review of the Ordinance, concerns were raised regarding the proliferation of vacation rental and homestay uses and neighborhood impacts associated with them. According to City records, no complaints have been received against the permitted operations. Complaints associated with vacation rentals and homestays have typically focused on individuals operating without proper permits. Staff from Planning and Neighborhood Services have been working together to educate operators about permit requirements and take enforcement action as necessary. A recent approval of a vacation rental on Old Ranch Road was appealed to the Planning Commission by the neighboring property owners. The appellants had concerns about safety, security, noise, traffic, and neighborhood property values. The Planning Commission considered the appeal on July 7, 2015. At that time, the Planning Commission adopted a Resolution denying the appeal and approving the vacation rental, due partly to the Ordinance having been constructed in such a way as to reduce these impacts on surrounding neighborhoods. At the time of Ordinance introduction, the Council added concentration limitations in the form of a 300 foot linear separation between the same uses on the same block face. Under these concentration limits, a vacation rental or homestay could not be established within 300 feet of an established vacation rental or homestay on the same street. However, the two uses could back up to one another so long as they were not part of the same block face. The effectiveness of these limitations has yet to be tested due to the limited number of permits approved for the uses. ALTERNATIVES: No alternatives are provided; the report is informational in nature. ADVANTAGES: The status report responds to Council's desire to remain informed on the implementation of the Ordinance since its adoption. DISADVANTAGES: None identified by staff. Item 11.b. - Page 2 CITY COUNCIL CONSIDERATION OF STATUS REPORT REGARDING DEVELOPMENT CODE AMENDMENT 14-002 REGULATING VACATION RENTALS AND HOMESTAYS AUGUST 25, 2015 PAGE3 ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTICE AND COMMENT: The agenda was posted at City Hall on Thursday, August 20, 2015 and the agenda and staff report were posted on the City's website on Friday, August 21, 2015. No public comments were received. Attachments: 1. Ordinance No. 663 2. Minutes of the May 27, 2014 City Council meeting (introduction of the Ordinance) 3. Map showing distribution of vacation rentals and homestays Item 11.b. - Page 3 [ : ! l __ , ATTACHMENT 1 ORDINANCE NO. 663 AN· ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING TITLE 16 OF THE ARROYO GRANDE MUNICIPAL CODE -REGARDING VACATION RENTALS AND HOMESTAYS WHEREAS, the City of Arroyo Granqe ("City'') currently does not regulate vacation rentals or homestays; and WHEREAS, the City does regulate similar transient uses with similar impacts such as bed and breakfast inns; and WHEREAS, the City Council finds that, unless properly regulated, vacation rentals and homestays can result in adverse impacts to adjacent properties; and WHEREAS, the purpose of these regulatio·ns is to ensure that vacation rentals and homestays conform to the existing character of the neighborhood in which they are located and do not create an adverse impact on adjacent properties; and WHEREAS, the increasing popularity of vacation rentals and homestays in the City the implementation of appropriate regulations to ensure that impacts are addressed and the character of existing neighborhoods is maintained, while providing an expanded type of lodging facility available within the City; and · WHEREAS, it is the purpose of this Ordinance to protect the public health, safety, and welfare within the City by establishing rules and requirements for vacation rentals and homestays; and WHEREAS, after consideration of all testimony and all relevant evidence, the City Council has determined that the following Development Code Amendment findings can be made in an affirmative manner: A. The proposed revisions to Title 16 are required to ensure consistency with the objectives, policies and implementation· measures of the General Plan, particularly the Land Use Element, and is therefore desirable to implement the provisions of the General Plan. B. The proposed revisions to Title 16 will not adversely affect the public health, safety, and welfare or result in an illogical land use pattern. C. The proposed revisions are consistent with the purpose and intent of Title 16 and satisfy the intent of Chapter 16.08 of the Municipal Code and provide for internal consistency. D. The proposed revisions to Title 16 are exempt under per Section~ 15061(b)(3) and 15308 of the California Environmental Quality Act (CEQA) Guidelines. Item 11.b. - Page 4 ORDINANCE NO. 663 PAGE2 NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Arroyo r Grande as follows: SECTION 1: The above recitals and findings are true and correct and incorporated herein by this reference. SECTION 2: Arroyo Grande Municipal Code Section 16.52.230 is hereby added as follows: SECTION 16.52.230 -VACATION RENTALS A. Purpose and intent. The purpose of these regulations is to ensure that vacation rentals located in the city conform to the existing character of the neighborhood in which they ·are located and do not create an · adverse impact on adjacent properties. B. Applicability. Vacation rentals may be permitted only with approval of a minor use permit. Vacation rentals shall comply with the property development standards of the underlying district and the performance standards and special conditions listed in Section 16.52.230.C. C. Performance standards and conditions for vacation rentals. 1. Operators of vacation rentals are required to obtain a minor use permit- plot plan review (Section 16.16.080) and a business license. 2. Any proposed vacation rental shall be compatible with the neighborhood in which it is located in terms of landscaping, scale and architectural character. The use shall be harmonious and compatible with the existing uses with the neighborhood 3. All Building Code and Fire Code requirements for the level of occupancy of the vacation rental shall be met. 4. All environmental health regulations shall be met. 5. The operator of the vacation rental shall, at all times while the property is being used as a vacation rental, maintain a contact person/entity within a fifteen (15) minute drive of the property. The contact person or entity must be available via telephone twenty-four (24) hours a day, seven (7) days a week, to respond to complaints regarding the use of the vacation rental. . The contact person or entity shall respond, ·either in person or by return telephone call, with a proposed resolution to the complaint within three (3) hours between 7:00 am and 9:00 pm, and within thirty (30) minutes between 9:00 pm .and 7:00 am. [ : Item 11.b. - Page 5 r [ ·- . .- ORDINANCE NO. 663 PAGE3 6. The operator of the vacation rental shall annually, at the time of renewal of the business license, notify the Community Development Department of the name, address and telephone number of the contact person required in subsection 16.52.23'0.C.6. 7. A written notice shall be conspicuously posted inside each vacation rental unit setting forth the name, address and telephone number of the contact person required in subsection 16.52.230.C.6. The notice shall also set forth the address of the vacation rental, the maximum number of occupants permitted to stay overnight in the unit, the maximum number of vehicles allowed to be parked on"site, and the day(s) established for garbage collection. The notice shall also provide the non"emergency number of the Arroyo Grande Police Department. . . 8. On"site advertising of the vacation rental is prohibited. 9. The number of overnight occupants shall be limited to two persons per bedroom and two additional persons. A bedroom shall meet the minimum size requirements as defined in the Building Code. 10. All refuse shall be stored in appropriate containers and placed at the curb for collection every.week . 11. The operator of the vacation rental shall pay Transient Occupancy Tax as required by Arroyo Grande Municipal Code Section 3.24.030. 12. Establishment of a vacation rental within 300 feet of an existing vacation rental on the same street shall not be permitted. 13. Violations -violation of these requirements shall constitute grounds for revocation of the minor use permit pursuant to Section 16.16.220. SECTION 3: Arroyo Grande Municipal Code Section 16.52.240 is her~by added as follows: SECTION 16.52.240 -HOMESTAYS A. Purpose and intent. The purpose of these regulations is to ensure that homestays located in the city conform to the existing character of the · neighborhood in which they are located and do not create an adverse impact on adjacent properties. B. Applicability. Homestays may be permitted only with approval of a minor use permit. Homestays shall comply with the property development standards of the Item 11.b. - Page 6 :. "- ORDINANCE NO. 663 PAGE4· unde~ying district and the performance standards and special_condltions listed in r Section 16.52.240.C. C. Performance standards and conditions for homestays. 1. Operators of homestays are required to obtain a minor use permit-plot plan review (Section 16.16.080) and a business license. 2. Any proposed homestay shall be compatible with the neighborhood in which it is located in terms of landscaping, scale and architectural character. The use shall be harmonious and compatible with the existing uses with the neighborhood ·· 3. All Building Code and Fire Code requirements for the level of occupancy of the homestay shall be met. 4. All environmental health regulations shall be met. 5. The operator shall reside on the premises. 6. 7. 8. 9. Individual guest stays shall be limited to fourteen (14) days, with a seven- day period between stays. On-site advertising of the homestay is prohibited. A bedroom shall meet the minimum size requirements as defined in the Building Code. . The operator of the homestay shall pay Transient Occupancy Tax as required by Arroyo Grande Municipal Code Section 3.24.030. 10. Establishment of a homestay within 300 feet of an existing homestay on the same street shall not be permitted. 11. Violations -violation of these requirements shall constitute grounds for revocation of the minor use permit pursuant to Section 16.16.220. SECTION 4: The following definitions in Arroyo Grande Municipal Code Subsection 16.04.070.C. are hereby amended or added as folfows: 16.04.070.C. Definitions "Bed and breakfast inn" means an owner-occupied dwelling unit where three (3) or more [ short-term lodging rooms and meals are provided for compensation or onsite signage is desired. , Item 11.b. - Page 7 r L- l ORDINANCE NO. ·663 PAGES "Homestay'' means an owner-occupied dwelling unit where a maximum of two (2) short- term lodging rooms are provided for compensation. "Vacation rental" means a structure being rented for less than thirty (30) days without concurrently being occupied by the owner/operator where the short-term lodging is provided for compensation. - SECTION 5: Arroyo Grande Municipal Code Section 16.16.080 is hereby amended to add Subsection B.1 O and Subsection C.6 as follows: . 16.16.080.8.10. Establishment of vacation -rentals or homestays in applicable zoning districts identified in Table 16.32.040-A and Table 16.36.030(A). 16.16.080.C.6. For plot plan reviews establishing the use of property for vacation rental purposes, the decision of the community development director shall also be mailed to all property owners of parcels within three hundred (300) feet of the property for which the plot plan review has been requested, in addition to the· requirements of Sectio!l 16.16.080.C.5. The notice shall indicate the appeal provisions of Section 16.12.150. SECTION 6: Arroyo Grande Municipal Code Table 16.32.040-A, entitled "Uses Permitted Within Residential Districts", Section A Residential Uses is hereby amended to add Subsection A.17. as follows: USE RE RH RR RS SF VR D-2.4 MF MFA MFVH MHP A. Residential Uses 17. Vacation Rentals MUP MUP MUP MUP MUP MUP MUP MUP NP NP and Homestavs SECTION 7: Arroyo Grande Municipal Code Table 16.36.030(A), entitled "Uses Permitted Within Mixed Use and Commercial Districts", Section B. Services -'General is hereby amended to add the following use: USE VCD VMU HCO D-2.11 OMU 1 TMU D-HCO o~ Specific IMU D-2.11 2.4 D-2.4 GMU FOMU HMU 2.20 Rc2 Use Stds B. Services -General Vacation Rentals and NP MUP MUP MUP MUP MUP MUP MUP NP 16.52.230 Homestavs 16.52.240 SECTION 8: If any section, subsection, subdivision, paragraph, sentence, or clause of this Ordinance or any part thereof is for any reason ·held to be unlawful, such decision shall not affect the validity of the remaining portion of this Ordinance or any part thereof. The City Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, or clause thereof, irrespective of the fact that any one or more section, subsection, subdivision, paragraph, sentence, or clause be declared unconstitutional. Item 11.b. - Page 8 ORDINANCE NO. 663 PAGES SECTION 9: Upon adoption of this Ordinance, the City Clerk shall file a Notice of r Exemption pursuant to 14 CCR§ 15062. · SECTION 1 O: A summary of this Ordinance shall be published in a newspaper published and circulated in the City of Arroyo Grande at least five (5) days prior to the City Council meeting at which the proposed Ordinance is to be adopted. A certified copy of the full text of the proposed Ordinance shall be posted in the office of the City Clerk. Within fifteen (15) days after adoption of the Ordinance, the summary with the names of those City Council Members voting for and against the Ordinance shall be published again, and the City Clerk shall post a certified copy of the full text of such adopted Ordinance. SECTION 11: This Ordinance shall take effect thirty (30) days from the date of adoption. On. motion of Council Member Barneich, seconded by Council Member Brown, and on the following roll call vote to wit: AYES: Council Members Barneich, Brown, Costello, Guthrie, and Mayor Ferrara NOES: None ABSENT: None the foregoing Ordinance was adopted this 10th day of June, 2014. [ __ _ l - Item 11.b. - Page 9 r [ - [ - ORDINANCE NO. (p/p.3 PAGE7 ATTEST: APPROVED AS TO CONTENT: APPROVED AS TO FORM: T1"°1" J. cAitME(, CITY ATTORNEY Item 11.b. - Page 10 OFFICIAL CERTIFICATION I, KELLY WETMORE, City Clerk of the City of Arroyo Grande, County of San Luis Obispo, State of California, do hereby certify under penalty of perjury, that the attached is a true, full, and correct copy of Ordinance No. 663 which was introduced at a regular meeting oft.he City Council on May 27, 2014; was passed and adopted at a regular meeting of the City Council on the 1 oth day of June 2014; and was duly published in accordance with State law (G.C. 40806). WITNESS my hand and the Seal of the City of Arroyo Grande affixed this 12th day of June 2014. r [ : l __ Item 11.b. - Page 11 • 0 Minutes: City Council Tuesday, May 27, 2014 9. PUBLIC HEARINGS ATTACHMENT 2 9.a. Consideration of Development Code Amendment Case No. 14-002 regarding Vacation Rentals and Homestays; Location: Citywide; Applicant -City of Arroyo Grande. Associate Planner Downing presented the staff report and recommended the Council introduce an Ordinance amending portions of Title 16 of the Arroyo Grande Municipal Code regulating vacation rentals and homestays. Staff responded to questions from Council. Mayor Ferrara opened the public hearing . . The following members of the public spoke: .: Jennifer Swift, James Way, in opposition of the proposed ordinance; -Robin Rinzler, in support of the proposed ordilJa.nce; -Shirl~y Volpatti, Hillcrest Drive, in support of the proposed ordinance; -. Diane Puhek, in support of the proposed ordinance; -: Audrey Howard, Robin Circle, in opposition of the proposed ordinance; -Peggy Thayer, SLO resident, in support of the proposed ordinance; -Doug Gaver, Allen Street, in support of the proposed ordinance; -Aaron Thompson, Crown Hill, in support of the proposed ordinance; -Jenny Shaheen, Heritage Lane, in opposition of the proposed ordinance; -Pete Evans, SLO resident, 1n support of the proposed ordinance; -Kathy Johnson, Robin Circle, in opposition of the proposed ordinance; -Paul Rinzler, Gaynfair, in support of the proposed ordinance; -Marian Colver, SLO resident, in support of the proposed ordinance; -John Diaz, Arroyo Grande, in opposition of the proposed ordinance; -Claire Volner, Arroyo Grande, in support of the proposed ordinance; -Joe Klaman, in support of the proposed ordinance; -Andrew Woodard, in. support of the proposed ordinance; -Betty De Paul, Robin Circle in opposition of the proposed ordinance; -Eve Newhouse, SLO resident, in support of the proposed ordinance; -Michael Howard, Robin Circle, in opposition to homestays; -Gay Groomes, Arroyo Grande, in support of the proposed ordinance; -Walt Bethel, Cardinal Court, in support of the proposed ordinance; -Catherine Doyle, SLO resident, in ~upport of the proposed ordinance. Upon hearing no further comments, Mayor Ferrara closed the public hearing. Mayor Ferrara called for a break at 7:55 p.m. The Council reconvened at 8:10 p.m. Council questions and discussion ensued regarding application fees, concentration limits, traffic, parking, and whether or not the ordinance should include a look back provision after one year. Action: Council Member Brown moved to introduce an Ordinance, entitled: 11AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE AMENDING TITLE 16 OF THE ARROYO ·GRANDE MUNICIPAL CODE REGARDING VACATION RENTALS AND HOMESTAYS"; as modified to include a condition that there would be a 300 linear foot distance restriction for location of vacation rentals and homestays, and with the provision that there Item 11.b. - Page 12 Minutes: City Council Tuesday, May 27, 2014 Page6 would be a minimum of a one year look back unless conditions warrant an earlier review due to complaints received. Further, to request that educational discussions be provided to vacation rental and homestay hosts regarding neighborhood sensitivity to parking issues. Council Member Costello seconded. Brief discussion ensued clarifying that the 300 linear foot distance restriction is applied in either direction on the same street; and that staff would provide a monthly report to Council on any com.plaints/code enforcement action taken with regard to violations of the vacation rental and homestay ordinance. In response to Council discussion, City Attorney Carmel clarified the modifications to the Ordinance and read them for the record, as follows: Adding Condition No. 12 for vacation rentals to read: "Establishment of ~ Vacation Rental within 300 feet of an existing Vacation Rental on the same street shall n9t be permitted:" · Changing the existing No. 12 to No. 13. Adding Condition No. 10 for homestays to read: "Establishment of a Homestay within 300 feet of an existing Homestay on the same street shall not be permitted." Changing the existing No. 10 to No. 11. Council Members Brown and Costello confirmed the changes to the ordinance as part of the motion, and the motion passed on the following roll-call vote: AYES: NOES: ABSENT: Brown, Costello, Barneich, Guthrie, Ferrara None None Council Member Costello left the meeting at 9:00 p.m. Consideration of Request from South County Sanitary Service for Integrated Solid aste Collection Rate Increase. Rec mended Action: Adopt a Resolution establishing integrated solid waste collection ice rates. Administrative Services 01 or Malicoat introduced Bill Statler, who presented the results of the rate study and recommende olid waste collection rate increase. Mr. Statler and Tom Martin, represen · Service, responded to questions from Council. · Mayor Ferrara opened the public hearing. the public hearing. no comments, Mayor Ferrara clo~ed Action: Mayor Pro Tern Guthrie moved to approve·~ RESOLUTI F THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE ESTABLISHING INTEG COLLECTION SERVICE RA TES". Council Member Barneich seconded, passed on the following roll-call vote: SOLID WASTE d the motion Item 11.b. - Page 13 Item 11.b. - Page 14